Riaz Haq writes this blog to provide information, express his opinions and make comments on wide ranging topics.The subjects include personal activities, education, South Asia and South Asian community activities, regional and international affairs and US politics to financial markets and beyond. For investors interested in South Asia, Riaz has another blog called South Asia Investor at http://southasiainvestor.blogspot.com

Saturday, April 4, 2009

Pakistan Pursues Hydroelectric Projects

Pakistan and Germany have initiated serious discussions of German funding of eight ongoing and new hydropower projects worth billions of dollars. These talks are taking place in Islamabad between visiting German Minister for Economic Co-operation and Development Ms. Heidemaire Wiegoreak Zeul and Pakistani Prime Minister's Adviser on Finance Mr. Shaukat Tarin, according Business Recorder newspaper.

Ms. Heidemaire Wiegoreak Zeul said that Germany was part of Friends of Democratic Pakistan (FoDP) and she had come here for the assessment of the situation and development needs to be discussed at Tokyo in April 17 and then again at the end of April during the annual meeting of the World Bank and IMF. She added that this support was important for Pakistan's development to stabilize the country and the region.

In addition to megaprojects such as 1000 MW Neelum-Jhelum hydropower project, a number of community-based micro hydro projects are being executed with the help of the Agha Khan Foundation in Pakistan's Northern Areas and NWFP. Within this region, out of a total of 137 micro-hydro plants, the AKRSP has established 28 micro-hydros with an installed capacity of 619kW. Initially, in 1986, these plants started as research and demonstration units. These projects were extended to Village Organizations (VOs) and became participatory projects. A Village Organization (VO) is a body of villagers who have organized themselves around a common interest.

After formation, each village organization signed a partnership with AKRSP to abide by all terms and conditions necessary for the village development. The entire responsibility of implementation was passed on to the VOs. AKRSP provided the negotiated cost of the plants and technical input required during the construction period. All the VOs completed the civil work of the plants. They purchased and transported machinery from other parts of Pakistan. The VO members provided subsidized or free unskilled labour and locally produced building material.

Pakistan's current installed capacity is around 19,845 MW, of which around 20% is hydroelectric. Much of the rest is thermal, fueled primarily by gas and oil. Per capita energy consumption of the country is estimated at 14 million Btu, which is about the same as India's but only a fraction of other industrializing economies in the region such as Thailand and Malaysia, according to the US Dept of Energy 2006 report. To put it in perspective, the world average per capita energy use is about 65 million BTUs and the average American consumes 352 million BTUs.

The electric power situation in India is not much better. The country is suffering its worst electricity crisis and it has become a key election issue in states like Karnataka and Maharashtra. Some major cities in India are facing alarming situations; continuous load shedding in Bangalore has led to diesel shortage as people are using diesel generators to deal with the crisis. Maharashtra, Uttar Pradesh, West Bengal and Haryana are the worst hit by the ongoing crisis and they are facing power gaps of about 5,000MW, 1,000MW, 2000MW, 1,500MW respectively. In Maharashtra, state officials are asking industrial consumers to lower their demand by 10% or be ready to face forced load shedding (rolling blackouts). Cities and towns are facing 7 to 13 hours blackouts.

With 40% of the Pakistani households that have yet to receive electricity, and only 18% of the households that have access to pipeline gas, the energy sector is expected to play a critical role in economic and social development. With this growth comes higher energy consumption and stronger pressures on the country’s energy resources. At present, natural gas and oil supply the bulk (80 percent) of Pakistan’s energy needs. However, the consumption of those energy sources vastly exceeds the supply. For instance, Pakistan currently produces only 18.3 percent of the oil it consumes, fostering a dependency on expensive, imported oil that places considerable strain on the country’s financial position, creating growing budget and trade deficits. On the other hand, renewable energyfrom hydro, wind and solar are perhaps underutilized and underdeveloped today, as Pakistan has ample potential to exploit these resources.

Pakistan has vast reserves of coal. But there is very little energy produced by burning coal. China has now agreed to invest about $600 million for setting up an integrated coal mining-cum-power project in Sindh. The project will produce 180 million tons of coal per year, which is sufficient to fuel the proposed 405 MW power plant. Pakistan is currently world's seventh largest coal-producing country, with coal reserves of more than 185 billion tons (second in the world after U.S.A.'s 247 billion tons). Almost all (99 percent) of Pakistan's coal reserves are found in the province of Sindh. Pakistan's largest coal field is Thar coal field which is spread over an area of 9100 square kilometers, and contains 175 billion tons of coal. So far this coal field has not been developed but efforts are underway.

In addition to the coal project, China has agreed to build several other power plants in Pakistan to help the South Asian nation deal with its worsening electricity crisis. When completed over the next several years, these plants, including Nandipur (425 MW, Thermal), Guddu(800 MW, Thermal) and Neelam-Jhelum(1000 MW, Hydro), Chashma (1200 MW, Nuclear) will add more than 3000 MW of power generating capacity for the energy-hungry country. Pakistan is currently facing a deficit of 4,000 to 5,000 megawatts, resulting in extensive load-shedding (rolling blackouts) of several hours a day.

China has already installed a 325-megawatt nuclear power plant (C1) at Chashma and is currently working on another (C2) of the same capacity that is expected to be online by 2010. The agreements for C3 and C4 have also been signed. The United States has objected to China supplying C3 and C4 on the grounds that any Pak-China nuclear cooperation would require consensus approval by the NSG, of which China is now a member, for any exception to the guidelines. The US is applying double standards since it supported and got approval for such an exception from NSG for its own nuclear deal with India.

Beyond the power generation capacity expansion projects, Pakistan must also pay attention to modernizing its national grid. The country's creaky and outdated electricity infrastructure loses over 30 percent of generated power in transit, more than seven times the losses of a well-run system, according to the Asian Development Bank and the World Bank; and a lack of spare high-voltage grid capacity limits the transmission of power from hydroelectric plants in the north to make up for shortfalls in the south.

The current power crisis has given a significant impetus for serious efforts to develop a series of power projects. With so many projects in the pipeline, it can be expected that there is relief on the way for the electricity deprived nation in not too distant a future. In rural areas in particular, Pakistan has a better chance of meeting the UN Millennium Development Goals by building infrastructure projects and providing energy and water for development.

48 comments:

Why exactly are the Germans funding the destruction of two nature reserves? Palas is home to a dwindling population of Monal pheasants while the Hingol River contains Pakistan's last concentration of large wild Mahseer and Mugger crocodiles. Have environmental impact surveys been done for any of these projects? Several are in pristine areas. Will they be forced to adhere to EU environmental standards? If not, then why?

This debate between satisfying basic human necessities versus preserving biodiversity is playing out all over the world. But in a nation where 40% of the population has no access to safe water and electricity, I would err on the side of catering for basic human needs while still doing the best to protect nature.

The point is not that development should not be pursued but that it must be done with insight. Are there no other ways of generating renewable energy? There are. Are there no other places to build dams where their impact would be lower? There are. How will these dams in the far North be connected to the national grid through a tectonically active zone? Has Pakistan managed to relocate those people who were displaced by the building of previous dams? No.

As far as water is concerned, if we are concerned about its scarcity, why are so many canals in Pakistan still unlined? Why are canals being lined with unburnt brick? Why do farmers still follow inefficient irrigation techniques? There is an old UNDP report claiming that these improvements would result in saving a greater quantity of water than the total storage capacity of Tarbela.

If it is water quality we are concerned about, why does industrial effluent flow into rivers untreated? Why are outlawed pesticides and herbicides still freely available?

The question,then, is, where would the application of limited funds be more productive for finding long term solutions to the problems at hand?

I am not aware of the specifics of the locations you are concerned about. But, living in the US, I know that there is a powerful lobby advocating for preservation of nature, biodiversity and environment. But the US is at a very stage of development and 100% of the population has access to electricity and clean water. So Sierra Club is not out of place.

Pakistan is in a very different situation. The nation has severe shortages of both electricity and water. In my humble opinion, closing any options such as developing some pristine areas you point out is not a good idea. However, sufficient care should be taken to minimize negative impact to nature and environment without shutting down such projects.

Having lived a big chunk of my life in the Eastern Sierra, I know where you're coming from. But lets not forget that the first National Parks in the US came into being during Teddy Roosevelt's days, well before development reached the bulk of the rural areas. John Muir was active in the Sierra around the 1870's and the Sierra Club was founded in the 1890's. Remember that its opposition to the development of the dam in Hetch Hetchy dates to the early 1900's. This was then taken up again in the 1980's when Reagen, of all people, agreed to demolish the dam (which ended up not happening).

But, as you say, this debate is one that will continue deep into the future. Hopefully, there will still be something left to preserve then.

JHIMPIR: Prime Minister Yousuf Raza Gilani on Sunday inaugurated Pakistan’s first-ever wind energy scheme – the 50-megawatt ‘Zorlu Energy Wind Power Project’ – and said the government has created a fund to mainstream and implement alternative energy technologies in the country.

“The fund will be used partially to finance economically viable projects … and for the much-needed capacity building of the renewable energy sector,” said Gilani at the inauguration – which was attended by Sindh Governor Dr Ishratul Ibad, Chief Minister Qaim Ali Shah, Federal Minister for Water and Power Raja Pervaiz Ashraf and the water and power secretary.

The prime minister said that the Alternative Energy Development Board (AEDB) – in collaboration with public and private stakeholders – had prepared a mid-term renewable energy policy document. He said the policy focussed on creating a feasible environment for power generation through renewable energy means in the country. “I hope the policy will be submitted to the cabinet and approved soon,” he said.

“The launch of the Zorlu wind farm is, indeed, a major milestone towards exploiting the wind potential of renowned Gharo-Keti Bandar Wind Corridor. This 60 kilometre long and 170 kilometre deep corridor alone has the potential to generate over 50,000 megawatts of electricity,” he said.

The prime minister said the launch of the project had heralded the beginning of a new era in Pakistan.

“I am proud to narrate that apart from the Zorlu wind farm, 24 other wind projects, with a cumulative capacity of 1,200 megawatts, are under way.”

He also praised the Zorlu Energy Group for its plan to expand the project to 250 megawatts. “This will also send a very strong signal … that Pakistan offers great opportunities to do business and investment.” app

Power sector has been holding Pakistan back in recent years. Here's BMI assessment of energy sector prospects:

The new Pakistan Power Report forecasts Pakistan will account for 1.37% of Asia Pacific regional powergeneration by 2013, with a stable theoretical generation surplus before the country’s substantialtransmission losses are taken into account. BMI’s Asia Pacific power generation assumption for 2008 is7,093 terawatt hours (TWh), representing an increase of 3.2% over the previous year. We are forecastingan increase in regional generation to 9,099TWh by 2013, representing a rise of 28.3%.

Asia Pacific thermal power generation in 2008 totalled an estimated 5,570TWh, accounting for 78.5% ofthe total electricity supplied in the region. Our forecast for 2013 is 6,999TWh, implying 25.7% growththat reduces the market share of thermal generation to 76.9% - thanks largely to environmental concernspromoting renewables, hydro-electricity and nuclear generation. Pakistan’s thermal generation in 2008was an estimated 62.8TWh, or 1.13% of the regional total. By 2013, the country is expected to stillaccount for 1.13% of thermal generation.

For Pakistan, gas is the dominant fuel, accounting for 47.5% of primary energy demand (PED) in 2007,followed by oil at 30.7%, hydro-electric energy at 12.9% and coal with a 7.9% share. Regional energydemand is forecast to reach 4,859mn tonnes of oil equivalent (toe) by 2013, representing 24.9% growthfrom the estimated 2008 level. Pakistan’s estimated 2008 market share of 1.52% is set to ease to 1.45%by 2013. The country’s estimated 2.5TWh of nuclear demand in 2008 is forecast to reach 5.0TWh by2013, with its share of the Asia Pacific nuclear market rising from 0.49% to 0.75% over the period.

Pakistan is ranked third behind India in BMI’s Power Business Environment Rating, thanks to itsrelatively high level of renewables (mostly hydro) generation and healthy power consumption/energydemand growth prospects. Several country risk factors offset some of the industry strength, but thecountry is in a good position to keep clear of Malaysia below.

BMI forecasts Pakistan real GDP growth averaging 3.98% a year between 2009 and 2013, with the 2009estimate at 2.50%. The population is expected to expand from 161mn to 177mn, with per capita GDP andelectricity consumption increasing by 20% and 11% respectively. Power consumption is expected toincrease from an estimated 81TWh in 2008 to 99TWh by the end of the forecast period, which provides arelatively stable theoretical generation surplus (before transmission losses, etc.), assuming 4.3% annualgrowth in electricity generation.

Between 2008 and 2018, we are forecasting an increase in Pakistani electricity generation of 59.2%,which is mid-range for the Asia Pacific region. This equates to 27.2% in the 2013-2018 period, up from25.1% in 2008-2013. PED growth is set to increase from 19.1% in 2008-2013 to 25.8%, representing49.9% for the entire forecast period. An increase of 49% in hydro-power use during 2008-2018 is a keyelement of generation growth. Thermal power generation is forecast to rise by 52% between 2008 and2018, with nuclear usage up 380% from a low base. More details of the long-term BMI power forecastscan be found at the end of this report.

ISLAMABAD: Deputy Chairman Planning Commission, Sardar Asef Ahmad Ali on Thursday said some changes had been made in Bhasha Dam project, particularly in its power component. In an exclusive interview with Daily Times he said the power component of Bhasha Dam would be run on Public Private Partnership basis so that burden on the government kitty might be reduced. In this regard he said that a ‘Company’ would be established, which would be converted into an international consortium. The consortium would be able to get equity as well as funds from the International Financial Institutions (IFI), Kuwait Funds and others.

Once the Company is established, he said that there would be no problems for funding, as it would be able to borrow from the market and repay the loan. “The government has assigned me to structure the Company,” the Deputy Chairman said and added that he would invite all power distribution companies including KESC to purchase its shares. The government and WAPDA might also purchase its share and later, expatriates would also be offered shares in it. In this manner, it would enjoy the status of an International Company. Its marketing plan would be carried out at world-class top companies and arrangements would be made to conduct internationals show for it. In this way, all requirements for making it an ‘Equity’ would be fulfilled, he added. All these measures have been carried out for the first time in Pakistan.

About PSDP (Public Sector Development Programme) he said that as a routine, the government releases 19 to 20 percent developmental funds in first quarter of the current fiscal year (July-September 2009). Reason for low allocation was the slow process of revenue generation through new measures adopted in the annual budget. PSDP releases for second quarter (Oct to Dec 2009) was already in progress. If the funds are released in time, he expressed hope that the government would be able to achieve its targets. At present, he said there was no indication by the ministry of finance regarding cut in PSDP 2009-10.

Currently the country’s revenue generation remained stagnant at 8.5 percent of the GDP, which he termed as lowest in the world. The government wanted to increase it to the level of 11 percent of the GDP. “Finance Minister Shaukat Tareen informed me that the government identified 2 million new taxpayers in the existing system and if it remains successful, then the PSDP will be remain as it is”, he maintained.

There have been widespread complaints in Islamabad, including by Finance Minister Shaukat Tarin, that the government had solutions to improve the power output but was refusing to implement them in order to benefit a handful of power plant operators, such as those supplying rental power at exorbitant rates, while the IPPs are not being paid for supplying power from currently underutilized installed capacity. Requests for information by Transparency International Pakistan regarding rental power contracts have been ignored by the Ministry of Water and Power. There are widespread corruption allegations against Mr. Zardari personally who has influenced the award of the 783 MW rental power contracts to a former governor of Oklahoma and his Pakistani partner.

Pakistan People's Party led coalition government has opted the option of using Rental Power Plants (RPPs) to overcome persistent electricity crisis that is not only causing great amount of hardships for the fellow citizens but also hitting hard to country's economy. There is much hue and cry from political and other circles over alleged kickbacks in deals of RPPs. Pakistan Muslim League-Nawaz has already announced to issue a White Paper on RPPs while another opposition party-Pakistan Muslim League (Q)- is also at the forefront in highlighting alleged wrongdoings in the execution of RPPs. Sources in PEPCO told PAGE that RPPs would provide electricity at a quick speed compared to IPPs which will reduce power deficit on an emergency basis. These rental projects are for five years and its costing responsibility rests with private sector investors.

The contract life of these projects is between 3-5 years, after which the government has no obligation to purchase power from these units. According to them, it is incorrect to suggest that rental power costs are substantially higher than that of IPPs. Due to different tariff of rental plants, even after taking into account the high fuel costs, the cost difference is almost equal or marginally higher in case of RPPs. Compared with IPPs, RPPs power generation cost ranges between 12-13 cents per KWh, and IPPs' power generation costs approximately 12 cent per KWh. Government circles are of the view that mere blame game is going on just for the sake of leg pulling. There is nothing wrong in RPPs and the only viable option to get rid of load shedding is rental power plants, they believe. They said rental tariffs for the projects depended on number of factors including location of the plants, system maintenance, and consumption of fuels. Others factors are variation in project cost due to difference in technology, age of machinery, and variations in financing. As many as, 14 approved RPPs with total generation capacity of 2250MW will start functioning by December, which would expectedly end the energy crisis.

However, critics of RPPs are of the sanguine view that highly controversial RPPs are proving last resort to overcome the power crisis, which has hit hard the economic growth of the country besides adding salt to public miseries at large. The political government has surrendered to public pressures on construction of Kalabagh Dam, the only way to survive ahead and instead preferred to go after a stopgap arrangement at a higher cost. The independent experts are of the view that RPPs would not only fail to meet rising electricity demand but also burden the national exchequer in general and power consumers in particular. The public is justifiable in questioning that if RPPs are the option, why it is adopted too late. According to Pakistan Electric Power Company (Pepco) Managing Director Tahir Basharat Cheema, an investment of around US $2 billion is expected in power sector through RPPs. Apart from investment in power sector, additional electricity of 1675 MW will be added in the system by December 2009 when nine rental power projects will start generation.

However, overall 2250 MW electricity will be generated through RPPs in current fiscal year (2009-10). Two rental power projects that have already started generation include Atlas Power (213 MW) and Attock Generation (156 MW) while remaining seven will start functioning by December 2009. These RPPs include Nishat (196 MW), Engro (203 MW), Saif Power (213 MW), Fauji Foundation (176 MW), Sapphire Electric Company (213 MW), and Orient Power Company (213 MW). He said all proposals of RPPs were accepted only with bid bonds and performance guarantee by sponsors.

Two questions: why have some private power producers completely shut down? Why are private power producers operating way below their full generating potential? Two answers: political score-settling plus the circular debt.

We at the Centre for Research and Security Studies (CRSS) have been trying for months to ascertain the crux of our power politics. Almost all roads lead back to the government. The federal government is the largest power defaulter, then come the four provincial governments, FATA, the KESC and the KW&SB. This is how the circular debt explodes into even bigger circles: the federal government does not pay its electricity bills to Water and Power Development Authority (WAPDA).

WAPDA is then unable to pay for electricity it buys from IPPs. IPPs are then unable to pay for their oil supplies. Refineries, short on cash, are unable to pay their foreign suppliers. Grow, grow, grow and we have a Rs200 billion time bomb.

Welcome to the rental power bonanza; the government’s ingenious – canny, crafty and cunning – all-in-one solution for the crux of our power politics. What we need to do is to re-start the power producers that are shut down. That’s 800 MW at US 11 cents per MW. What we need to do is to resolve our circular debt puzzle. What we need to do is to get our sugar mills connected to the national grid which could generate an additional 2,200 MW at less than US 11 cents per MW.

Aides of Finance Minister Shaukat Tarin said he almost resigned after failing to persuade the cabinet against renting, an option he considered expensive and inefficient.

Here are some questions and answers about the plight of the power sector in Pakistan and leasing plants.

WHAT IS THE PROBLEM?

Pakistan has about 20,000 MW of installed power production capacity, but that falls short of demand by roughly 4,000 MW. Lengthy power cuts, dubbed load shedding, have become commonplace.

Past governments failed to anticipate the growth in demand and delayed clearing power project proposals and big dam projects that would have boosted hydro power.

Lack of investment in existing plant, outdated grids and rampant electricity theft mean that some grid companies experience line losses of up to 30-40 percent, analysts say.

Many independent power producers (IPPs) operate well below capacity because they cannot pay their fuel bills regularly as grid companies owe them money.

The crisis has crippled industry, notably textiles, the main export sector and largest employer in the manufacturing sector.

There have also been violent protests that some analysts see as a bad omen both for the government and democracy in a country struggling to contain the growth of Islamist militancy.

WHAT IS BEING DONE TO BOOST SUPPLIES?

The 18-month-old civilian government has vowed to increase supplies but needs huge finances.

It recently reached an agreement with the World Bank and Asian Development Bank to phase in power tariff increases.

The government is working on a multi-pronged strategy to address the problem through building new dams and setting up new permanent power plants. It sees Rental Power Plants (RPPs) as the "only solution", while completing medium and long-term projects.

WHAT IS RENTAL POWER PLANT?

Countries can hire power units from overseas manufacturers that can be shipped in kit form and installed.

It takes four to six months to set up a rental unit, while two to five years may be needed for an Independent Power Producer to build a plant.

Surging emerging economies like China and Turkey have gone the short-term rental route to bridge power supply gaps. And Pakistan, according to official documents, had two rental units commence operation in 2007.

Under the new plan, additional RPPs would be set up to generate 2,250 MW by the end of the year.

HOW WILL RENTAL POWER PLANTS IMPACT FUEL DEMAND?

The rental power plants would increase the Pakistani power sector's furnace oil needs by 29 percent, driving up its import bill and adding to pressure on the rupee and currency reserves.

Pakistan requires 35,000 tonnes a day to feed its thermal power plants and the installation of the RPPs will increase demand to 45,000 tonnes, officials say.

The country imports about 80 percent of its oil. It spent $9.5 billion on the import of 10.6 million tonnes of petroleum products and 7.8 million tonnes of crude oil in the 2008/09 (July-June) financial year.

WHAT ARE THE PROS AND CONS?

Rental plants can provide breathing space for Pakistan to focus on medium- and long-term projects.

Advocates say rental plants are efficient, will help quickly meet growing needs, and end-consumers will pay the same or a bit less for their electricity.

Opponents say the mostly second-hand equipment will be less efficient and that the tariff will rise. They argue that the government would be better off spending money on upgrading and using idle existing capacity.

Some opponents also say the option is being supported by corrupt politicians hoping for kickbacks.

Here is an explanation offered by the News for gas and CNG shortage in Pakistan:

ISLAMABAD: The multi-million dollar mystery shrouding the serious shortage of gas in the country, which has already led to twice a week closure of CNG stations, seems to have finally been resolved, as millions of cubic feet of gas per day is now being supplied to powerful owners of the controversial rental power plants in the country as the Economic Coordination Committee of the Cabinet meeting on Tuesday (tomorrow) has been asked to approve additional supplied for these plants.

The official sources said these expensive rental power plants, which were being installed with tall claims to address the energy crises in the country, were said to have now become one of the major reasons behind a new sorts of energy crises in Pakistan, as their gas requirements are bound to hit other sectors of economy running on gas supplies. The cement sector has already been hit as its gas supply is now being diverted to one such power plant at Naudero.

Under the agreed deal which was subjected to criticism both within and outside the Parliament, these rental power plants will continue to get gas supplies for five years till the completion of their agreements with the Ministry of Water and Power.

The formal approval of this gas supply is being given in the Economic Committee of the Cabinet (ECC) meeting tomorrow (Tuesday). Finance Minister Shaukat Tarin will preside over the meeting as Petroleum Minister Naveed Qamar is out to get the approval for these plants as proposed in the official summary of his ministry.

The sources said the supply of gas would become a huge issue in the coming days for even the domestic consumers after the government would divert more gas to these rental power plants after diverting it from the sectors which were now regularly getting the supplies. Now ECC was asked to give supply of gas only for one plant. Sources said, more demands from other power plants will soon follow and then the country would really experience the burden of these power plants, which were ironically being installed to address the very energy crises of the country.

The official papers to be laid in the ECC meeting revealed that the gas meant for the cement sector in particular was being drastically reduced and diverted to the rental power plants in the country. One source said, certain other sectors which are already getting the gas in the country soon may also face similar kind of cuts in their approved supply to accommodate the privileged and powerful owners of the plants having direct links at the top levels.

The huge gas supply is being supplied as a part of deal struck with these rental power plants by the Ministry of Water and Power in controversial circumstances.

According to the official papers to be tabled in the ECC meeting, the Ministry of Petroleum was now seeking the approval of diversion of gas from cement to power plants and initially a power plant of 51 MW was being provided with 30MMCFD. The papers said earlier the ECC has decided on October 2 to place 12 MMCFD gas from SSGC system at the disposal of PPIB/Ministry of Water and Power for five years for power generation in accordance with the natural gas allocation and management policy of 2005. The official summary said the Ministry of Water and Power have now informed that 12 MMFCD gas been allocated to the power plants project.

The summary said, based on SSGCL commitment, it is proposed that 15 MMCFD additional gas from SSGCL system which includes diversion of 14MMCFD gas being supplied to cement sector may be placed at the disposal of PPPB/ Ministry of Water and Power on the “ as and when available basis for five years” for power generation subject to following conditions.

"I see the cost of [solar] photovoltaics going down and down. Right now it's about $4 per watt for full installation. In a decade it will certainly be less than $2. If it's $1 or $1.25, then everyone will put it up without subsidy. What else do I see? A new generation of biofuels that are direct substitutes for gasoline—so, better than ethanol—using agricultural waste: weed straw, rice straw, corncobs, wood surplus."

"We're at about 4 percent now (renewables sources). President Obama made a target to double that by 2012, and we are on target. I expect that to continue. In 10 years' time we hope to have carbon-capture-and-sequestration technologies starting to be deployed. Hopefully, we'll have restarted the nuclear industry and we'll be building several nuclear reactors."

Wake up Pakistanis! As we all know that Pakistan is distress from electrical vitality destitution but why Dam makeup venture immobile on paper?it is truly more esteemed to every component of Dam makeup Project as an alternative more on overseen projects. At the point we are standing today as a nation, its time to accomplish a thing to receive out of us from such a wretched condition.

Here's a piece on plans for wind turbine domestic manufacturing in Pakistan published in Dawn:

PROPOSALS for local manufacturing of wind turbines and allied equipment on commercial basis from foreign and domestic companies for partnership with Pakistan Machine Tool Factory (PMTF) at Karachi are in advanced stage of evaluation. The initiative has been launched by the State Engineering Corporation.

In July 2009, the expressions of interest (EOIs) were invited by the Corporation internationally. World reputed manufacturers in the USA, China and the European countries were also contacted directly seeking their collaboration for progressive manufacturing of wind turbines.

Enormous potential for power generation from wind energy has been identified in various parts of the country.. In 2006, the Alternate Energy Development Board (AEDB) had announced an attractive investment policy for promotion of renewable energy and many manufacturers of wind turbines like GE Energy (Canada), Vestas (Denmark) and Siemens/Fuhrlander (Germany) had shown interest in setting up wind farm projects in partnership with domestic entrepreneurs.

This is not for the first time that efforts have been made for manufacturing of machinery for wind mills. In response to the Energy Policy 1994, two wind power projects were proposed to be established in Sindh and Balochistan. The American sponsors of Kenetech wind power project of 100 mw capacity, who are also the manufacturers of wind turbines, had collaborated with the PMTF for local manufacturing of wind turbines, under technology transfer arrangement. No physical progress was achieved as none of the projects was approved by the government, courtesy the powerful lobby of oil-based thermal power plants.

Again, in 2006, Heavy Mechanical Complex (HMC) planned to diversify its wide-range production programme of power plant machinery to cover wind energy projects as well. The pioneering efforts by HMC to obtain requisite technology for one or two megawatt capacity wind turbine from any global key player however, were thwarted by the AEDB, which instead supported private sector participation for local manufacturing. The AEDB had claimed to have signed agreements with a few Western companies for the design, engineering and manufacturing of wind turbines and accessories. Based on these agreements the AEDB was said to be looking for qualified companies to commence assembly-cum-manufacturing of equipment locally. Nothing happened.

In the recent past, New Park Energy Limited proposed to establish a wind turbine generator assembly plant at Nooriabad, Dadu. The sponsor has obtained approval for the development of a wind farm of 1,000 mw in phases, the first phase project being of 400 mw capacity.

The government has allocated 1,000 acres of land to the company in the Gharo-Keti Bunder wind corridor on concessionary rates. The first wind energy project was thus launched in December 2004, but only of 45 mw capacity, proposed to be installed with 30x1.5 mw General Electric (GE) wind turbines. The project, which was to attain commercial operations in 2007, still remains on paper and even the Letter of Support (LOS) has not yet been obtained by the sponsors, despite a lapse of five years......

If the indigenisation programme is successfully implemented it would prove to be precursor for rapid development of the wind power projects for its low cost, high reliability and for being environmental friendly. India has over 10,833 mw installed wind power capacity, as in September 2009, with majority of wind turbines produced locally. Today, India has nine principal manufacturers and suppliers of wind electric generators in the range of 225 kw to two mw units.

China has offered to invest about $15 billion in Pakistan’s energy sector projects, according to Dawn News:

A Chinese delegation led by Cao Guanging, chairman of the state-owned China Three Gorges Project Corporation (CTGPC), discussed the Kohala, Bunji, Bhasha, Dashu and other hydropower projects in the upper and lower Indus valley during a meeting with Finance Minister Dr Abdul Hafeez Shaikh on Wednesday.

Dr Hafeez welcomed the offer and said he would try to develop consensus on issues relating to the projects. He said he would consult with the ministries of water and power and law and justice to sort out legal and other issues.

He informed the delegation about the country’s bidding rules and laws and assured it that the bidding process would be held in a transparent manner.

He said the Chinese offer had been discussed at a recent meeting of the Economic Coordination Committee of the cabinet. He said the projects identified by the CTGPC would be taken up with it but only after the completion of procedural matters.

The Chinese offer to provide financial and technical assistance for hydel and wind power projects, upgrade the transmission system and provide an integrated solution to the problems of power shortage and disruptions was elaborated by the CTGPC delegation at the Aiwan-i-Sadr on Wednesday.

Presidential spokesman Farhatullah Babar said in a statement that President Asif Ali Zardari had advised the government to consider tasking the CTGPC with building a run-of-the-river hydro project at Sukkur Barrage and asked Water and Power Minister Syed Naveed Qamar to discuss the project with the sections concerned and prepare a proposal in two months.

The president said that agreements with China ensured full security of Chinese investments in Pakistan. He said the true potential of business partnership between entrepreneurs of the two countries had yet to be fully realised.

Mr Babar said the CTGPC was already involved in a number power projects in the country and offered to build more to address the problems of power shortage. He said the corporation was currently undertaking Karot, Taunsa, Kohala and Bunji hydro-electric power projects. A letter of intent for the 720MW Karot project has been issued after the approval of its feasibility study. The project is currently at the tariff petition stage.

A memorandum of understanding for the 120MW Taunsa hydro-eclectic project has been signed and a development agreement will be signed this month. Mr Babar said the 1,100MW Kohala project was ready for tariff negotiations. A letter of intent for the project has already been issued after the approval of its updated feasibility study.

The 7,100MW Bunji project is ready for site survey. The MoU for the project was signed in August 2009.

Mr Babar said that wind power projects, including Sindh’s first and second wind farms and Punjab’s wind and solar projects, were also in an advanced stage.

Here's a Business Recorder news report on delays in Neelum-Jhelum construction project:

The pace of work on the important Neelum Jhelum hydroelectric project is very slow, as only 22 per cent work has been completed so far against the targeted 50 per cent. The detailed feasibility study of the 969 MW project was completed in 1997 and the revised Project Cost-I (PC-I) was approved by Executive Committee of the National Economic Council (Ecnec) on February 28, 2002 at a total cost of Rs 84502.26 million.

The work on the project was started in January 2008 and October 2015 was fixed as completion date. By 2011, about 50 per cent work was to be completed, however, only 22 per cent work has been completed so far, making it difficult the project would be completed on time, sources told Business Recorder.

Subsequent to the 2005 earthquake the PC-1 was revised again, which also affected the cost of the project and its completion period. They said after passage of almost half period of the project only 22 per cent work has been completed, which shows slow pace of work on the project.

Sources further revealed that till June 30, 2010, a sum of Rs 16897.243 was spent on the construction of the dam. In 2010-11's Public Sector Development Programme, Rs 14700 million were allocated and only Rs 3953.244 million have been spent so far. While a total amount of Rs 20850.487 million has been spent on the project so far.

Total required land for the project is 3400 Kanals and land awarded to Wapda is 3300 Kanals with another 100 Kanals required for which land acquisition process is underway. In addition there is an issue of transfer and possession of 26 Kanals that has not yet been handed over by the AJ&K government which is also causing delay in completion of the project.

Source maintained that if the project was not completed on time, the total cost of the project could increase as the cost of raw materials was increasing day by day. They added if the government was serious about resolving the electricity shortages then it should take appropriate measures to ensure timely completion of the project.

ISLAMABAD: As Water and Power Development Authority (Wapda) completes 28 per cent work on the 969MW Neelum-Jhelum Hydropower Project, the cost of which has gone up from Rs84 billion to Rs333 due to inordinate delay, Pakistan is pushing China to release the promised $500 million loan to bridge the shortfall of funds.

The cost of the project has increased after it was redesigned in the wake of the 2005 earthquake. Work on the project is progressing but the shortfall of funds and issues in land acquisition are still problems that need to be addressed to complete the project.

Wapda has also had to procure two Tunnel Boring Machines (TBMs) at the cost of Rs17 billion to overcome the delay of two and half years. “We will be able to reduce implementation time by two years by using TBMs that are expected to reach Karachi by January 25, 2012,” sources said.

Average completion level on the project is 28%. Some areas are progressing better, like the powerhouses, which are at 40% completion.

In the powerhouse, four turbines with a capacity of 242MW each will be set up. A separate plant of 45MW will also be set up at the diversion tunnel which was completed on October 15. A total of 60 kilometres of tunnels have to be completed including 35.6 kilometres of tunnels needed to push water to drive the turbines.

“As much as 17 kilometres have been completed,” sources said adding that work was underway on the coffer dam that is expected to be completed by February next year.

Sources said that a consortium of six banks including Exim Bank of China is providing financing for the project. “We are pushing Exim Bank of China to extend a $500 million loan to bridge the shortfall of funds,” sources said adding that other banks in the consortium were also being asked to extend additional $700 to $800 million loans.

The project cost has escalated on different accounts including Rs38 billion due as interest on loan, Rs45 billion on account of depreciation of rupee against dollar, from Rs45 to Rs86. Further cost increases were because of rate of land acquisition and procurement of two TBMs that cost Rs17 billion.

The government is to procure total 3,900 kanals of land out of which about 68 kanals is still outstanding, including the crucial portion of about 18 kanals for which payment of Rs1.2 billion has already been made to the AJK government.

“Despite payment, local people are reluctant to hand over land which may further delay the completion of the project,” sources added.

ISLAMABAD, Pakistan 12/20/11 (PennWell) -- Star Hydro Power Limited has been awarded a loan worth US$60 by the International Finance Corporation (IFC) for construction of the 147-MW Patrind hydropower plant in Pakistan.

The $409 million run-of-river project will be the largest privately financed hydroelectric facility in the country when it is completed in 2016, according to an IFC release.

Other investors include the Islamic Development Bank, the Export-Import Bank of Korea and the Asian Development Bank.

ADB previously announced a pledge of $97 million to the project in October 2011.

The project will be located between the Kunhar and Jhelum rivers near Muzaffarabad.

JEDDAH: The Islamic Development Bank (IDB) has signed a $60 million lease finance deal with Pakistan for the development of the Patrind Hydropower Project.

The agreement was signed by Ahmed Al-Hariri, manager, country operations division, Southeast Asia and Farouk Javed, CEO, Star Hydropower Limited in Islamabad.

The power plant is expected to be completed by 2016 and add 147 MW of power to the country’s national grid, helping the Asian country increase utilization of its renewable resources and generate power in an economically sustainable manner to reduce dependency on imported fuel.

“The project represents 100 percent foreign direct investment (FDI) in the country. After 30 years concession period the project will be handed over to the government of Pakistan,” a statement on the South Asian News Agency (SANA) said.

According to data from the IDB, Pakistan is the second-largest beneficiary of IDB financing.

Since the bank’s inception in the mid-1970’s the multi-lender has committed $7.6 billion including 85 projects worth $2.2 billion mainly in the transportation and power-generation sectors to the country.

In addition to the financing being committed by the IDB, funding is also being provided by the Export-Import Bank of Korea, the Asian Development Bank and the International Finance Corporation for a total injection of nearly $400 million for the project.

The project, according to a study carried out by its sponsors, Star Hydropower Limited, will call for the resettlement of 28 residences in the small village of Patrind on the Kumhar River.

“In Pakistan the increasing demand for electric power is now outstripping the supply. The gap between supply and demand has resulted in load shedding, causing serious setback to national economy. To close this gap, different possibilities for electrical power generation have been identified including a series of hydropower projects,” the report stated.

LAHORE: The Water and Power Development Authority (WAPDA) is installing two tunnel boring machines (TBMs) at a cost of Rs 8 billion on 969 megawatts (MW) – Neelum-Jhelum Hydropower Project to reduce construction period of the project by about 18 months aimed at estimated benefit of Rs 60 billion.

The two German-manufactured TBMs, being imported by the contractor, are expected to reach Pakistan by the end of this month.

Chinese EXIM Bank, after a long delay, has now approved $450 million loan to finance 969MW Neelum Jhelum hydropower project, which would add about 5.15 billion units of cheap electricity to the national grid every year by 2016.Well-placed official sources informed TheNation that Chinese EXIM Bank after a long delay has now approved $450 million loan to finance the Neelum Jhelum hydropower project located near Muzaffarabad adding that the Economic Affair Division (EAD) has also gotten an approval from the Chinese bank in this regard. They told that the Neelum-Jhelum hydropower project needed $700 million foreign funding to complete the project by 2016. The major financiers of the project include the Kuwait Fund, the Export Import Bank of China, the government of the UAE and the Saudi Fund for Development. Sources further told that project had originally been budgeted to cost Rs130 billion, but costs had witnessed skyrocketed rise by 154per cent to Rs330 billion. In the revised plan submitted by the water and power ministry, the main reason for the spike in costs was attributed to a change in design, but a detailed examination of the figures has shown that primary cause for the increase was delay in completion. Sources further told that more than 30per cent of the work on the project had been completed. The project would earn about Rs45 billion in revenues annually and would therefore be able to recover its cost of construction within seven years.It is also learnt that as the Chinese EXIM bank found hesitant to release the worthy amount since 2009 resultantly the delay for unknown reasons had caused the cost of the project to rise to Rs330 billion ($3.7 billion). It was also feared that the pace of construction might slowdown providing an edge to India, which had been building Kishanganga project on the same Neelum River on its side of Kashmir because if Pakistan failed to complete its project before India, then it might lose the water rights to the upper riparian country. Further, according to Indus Water Treaty (IWT), the country that first completes its project on Neelum tributary will have the priority rights on the water of Neelum River. Furthermore, the Neelum Jhelum Hydropower Project Company (NJHPC), a wholly owned subsidiary of the Water and Power Development Authority was set up to manage this very project.It is to be noted here that the top man of China had committed this loan during the visit of President Asif Ali Zardari to Beijing in 2009 but the Chinese Exim bank did not entrain Pakistan although three years have elapsed since the commitment of China to Pakistan resultantly the country was in contact with Islamic Development Bank, Saudi Development Bank, Abu Dhabi Fund, Kuwait Fund for the required finding. Even IDB had committed $200 million, Saudi Fund $337 million, Abu Dhabi Fund $100 million and Kuwait Fund $30 million and the government was pursing the said donors to expedite the disbursement of their credit line for the timely completion of the project.Waqar Masood Secretary Economic Affairs Division while confirming the information pertaining the receiving of approval worth of $450 million loan to help finance the 969-megawatt Neelum Jhelum hydropower project. He also informed that documentation process in this regard would take one month while disbursement of such a hefty amount is likely within one-month....

A: There’s nothing wrong about China going around the world making resource deals to support its growing population. What it’s doing makes a lot of sense. Yes, my concern is that other countries will not catch on until it is too late. In a zero-sum world, what will happen if China wins the race for resources? Other countries seem to be asleep while China is making a concerted effort. Some 24 ongoing wars and violent conflicts have their origins in commodities, and this trend is poised to continue. China is befriending what I call “the Axis of the Unloved”—countries and regions such as Africa, Brazil, Colombia, Argentina and parts of Eastern Europe that have been basically ignored by the Western economies. China is the leading trading partner and foreign investor in many of these countries—a very different approach to the West’s largely aid-based model.

Q: The Chinese economic edge in this is that its state capitalism offers advantages that the Western laissez-faire model does not.

A: Favoured Chinese companies have a zero or near-zero cost of capital. State-owned banks provide highly concessional credit lines, in the form of government grants or low-interest loans. Favoured companies also benefit from tax breaks and the preferential allocation of key contracts. Like the US$12-billion credit line extended to Wuhan Iron and Steel, a major steel producer, by the state-owned China Development Bank, for ﬁnancing “overseas resource base construction.” And of course it helps to have a war chest of over US$3 trillion, while Western economies are struggling with cash constraints.

Q: The Chinese political edge is that it’s famously untroubled by governance issues in the countries it deals with.

A: Well frankly, in practice there is little to distinguish between the commodity counterparts of Western nations and those of China. U.S. and European countries are just as happy as China to strike deals with countries with less than pristine reputations—whether it’s Saudi Arabia, Venezuela or Russia. Two wrongs don’t make a right, but in this narrow sense, it’s unfair to constantly point fingers at China.

Q: So you think that criticism of China on both scores—cheating, so to speak, economically and being too comfortable with dictators politically—is often unfair and wrong?

A: Cheating is one thing, meddling in the markets is a whole other thing. Virtually all governments meddle in the commodities markets. Western governments are particularly egregious in this respect. The United States paid US$6 billion in commodity subsidies in 2010. OECD countries spend a total of US$226 billion on agricultural subsidies yearly. And in the EU, the Common Agricultural Policy sees some 40 billion euros spent on direct farm subsidies. So if meddling in the market is “cheating,” China has a lot of company. And the West has never had much of a problem dealing with despots and dictators if there is a benefit to be gained.-------------A: I think the reasons are quite clear. China pursues strictly business, symbiotic relationships, trading access to commodities for infrastructure, employment and other economic benefits. Take employment. The construction of the Imboulou Dam in [the Republic of the] Congo in 2010 employed 2,000 locals (compared to 400 Chinese). Survey results indicate that Africans much prefer to deal with the Chinese than with Westerners. In Ivory Coast, Mali, and Kenya, more than 90 per cent of respondents see China’s economic growth as “a good thing.” In Tanzania, 78 per cent agree, but only 36 per cent feel the same way about American influence. The difference is stark. Across the developing world, people want jobs, infrastructure and investment and the Chinese engagement does exactly that. ....

The assembling of Tunnel Boring Machines (TBM) to dig mega tunnels according to international standards for 969 megawatts (MW) Neelum-Jhelum hydropower project is in process and will likely be operative during the first week of August 2012

Following international bidding, two German made TBMs costing Rs 8 billion had been installed on the project site Nauseri, Azad Jammu and Kashmir (AJK), where assembling of two giant mechanical milestones are under process and likely to be completed during last week of July and operative in the first week of August.

Speaking with Daily Times, Neelum-Jhelum Hydropower Company (NJHPC) CEO Lt Gen (r) Zubair Ahmed informed that with the help of TBMs, the early completion of 969 MW NJHP project could be possible and contribute in saving of Rs 67.5 billion revenue.

He said there is no truth in media reports that TBMs are not feasible for cutting mountains and could damage the entire project, adding that ‘project team had diverted river Neelum on October 2011, while 37.6 percent work on TBMs has been completed’.

He further said that after completion of 969 MW NJHP, more than 5.1 billion electricity unit would be generated, which will later be taken into the national grid at the point of Gakhar, Gujranwala, while the government would collect revenue of Rs 45 billion per year, adding ‘cost of per electricity unit generated from NJHP has been estimated Rs 2 per unit’.

This billion-dollar project was initiated in 2008 and estimated time of completion was announced 2015, however flood havoc completely destructed the whole infrastructure, and after the new design of NJHP, PC-1 cost was once again revised which increased its cost 135 times, which was approved by the Planning Commission on June 18 as Rs 274.822 billion new cost of this hydropower project.

Explaining the progress on Neelum water diversion tunnel, he said that more than 24 kilometres tunnel has been constructed out of total accumulated length 63 kms including entrance rage of tunnel through driller blast and other heavy mechanical equipment, however remaining part of tunnel would be completed soon as once TBMs would be operative. He also informed that the federal government has approved Rs 2.4 billion, which would be released soon and spent on construction of small projects including schools, model parks and health units for displaced persons from the site, while the land acquisition issue has also been resolved.

Out of 4,200 kanals of land, 3,850 kanals land has been acquired; however remaining land of 121.6 marlas is under litigation and would be resolved soon.

If Pakistan succeeded to commission NJHP before completion of controversial Indian hydropower project, it would not only grab water priority rights on the Neelum river, but also help Pakistan’s legal battle in the Permanent Court of Arbitration (PCA) at Hague against India on Kishanganga hydropower project as India is building it on the same river in held Kashmir with faulty design that negates the Indus Water Treaty. NJHP management was of the view that the completion of controversial Kishanganga could cause decrease in water inflow up to 14 percent in river Neelam, adding, ‘the country could face loss of $321 million annually, and agri-land of Muzaffarabad could be barren’. Public sector power managers ascertained that annual benefits of the project have been estimated at Rs 45 billion, adding that the project would payback its cost in about seven years.

Meeting notables from his constituency Gujjar Khan on Saturday, Prime Minister Raja Pervaiz Ashraf stressed the need for the construction of small dams to help the country overcome the energy crisis.

Talking about a development programme for the Potohar region, the premier said the construction of small dams would be his priority.

“Keeping in view the energy crisis, I will prefer building small dams across the country and start these projects from the Potohar region,” he told a public gathering

The prime minister said, “Pakistan is a country blessed with enormous natural and mineral reserves. Copper and gold deposits in Balochistan, Thar’s coal reserves, Punjab’s fertile land and more than 40,000MW hydro-electric potential in Gilgit-Baltistan are some of the examples … yet the country is still stricken with energy deficiency and poverty.” He observed that Pakistan’s resources have not been exploited due to political uncertainty, adding that economic development was intertwined with stability.

Prime Minister Ashraf vowed utmost efforts to rid people of unscheduled power outages in the minimum possible time. He termed this a short-term goal however claiming the government has planned long-term projects to resolve both scheduled and unscheduled outages permanently. He added that power generation had improved and would further improve in the near future.

The premier said instructions had already been issued to the interior ministry to provide Pakistani expatriates with machine readable passports as early as possible. He noted that they deserved a fair deal for their contribution to the country’s economy by sending millions in remittances.

He also underscored the importance of undertaking drives for deforestation and soil conservation in the region to minimise effects of climate change and restore the beauty and grandeur of the landscape.

Gujjar Khan’s notables expressed their pride in Prime Minister Ashraf, adding that the town had produced many of the country’s prominent personalities including the chief justice, the army chief, two Nishan-e-Haider recipients and several four-star generals.

Following the signing of an agreement with the government of Pakistan for providing $840 million for the 1,410-megawatt Tarbela 4th Extension Project, the World Bank has also agreed to extend financial assistance to the 4,320MW Dasu Hydropower Project.

It has also been agreed that the project will be constructed in phases after work on the 4,500MW Diamer-Bhasha Dam is initiated and its financial plan is finalised.

Water and Power Development Authority (Wapda) Chairman Shakil Durrani stated this while presiding over a meeting here at the Wapda House to discuss the report submitted by an international panel of experts.

Addressing the meeting, the Wapda chairman said international financial institutions were taking keen interest in providing funds for Wapda projects due to excellent ‘economic internal rate of return’ (EIRR) of these schemes.

The Dasu project is part of the least-cost energy production plan of Wapda aimed at harnessing the country’s hydropower resources to improve the share of hydroelectricity in energy mix.

The project will be constructed on the Indus River, seven km upstream of Dasu village and 74 km downstream of Diamer-Bhasha Dam. The project is situated on the Karakoram Highway, about 350 km from Islamabad.

According to a statement issued by Wapda, the priority is to construct Diamer-Bhasha Dam for which land acquisition process has already started and 13 contracts for offices, colonies and roads have been awarded.

Dasu Hydropower Project will follow the initiation of work on Diamer-Bhasha Dam. Detailed engineering design, for which the World Bank is providing funds, and tender documents are likely to be completed in early 2013. Afterwards, construction work will commence.

The project will generate 21.3 billion units of electricity per annum and will also have positive impact on existing hydropower stations including Tarbela, Ghazi Barotha and Chashma.

Here's an ET report on Russian interest in building Diamer Bhasha dam:

Russia is seeking direct award of a construction contract for the $13 billion Diamer Bhasha Dam in a government-to-government deal without resorting to international competitive bidding, sources say.

Faced with water and power shortages, Pakistan is looking for funds from China and Russia, who in turn want a government-to-government deal without international bidding.

The government’s search for funds came after multilateral donors asked Pakistan to get a no-objection certificate from India for the dam’s construction.

China and Russia want a similar arrangement for undertaking the Iran-Pakistan gas pipeline project, which has faced fierce opposition from the United States.

According to sources, Pakistan and Russia are likely to strike a final deal on the dam during visit of Russian President Vladimir Putin to Islamabad next month.

“A meeting of Pak-Russia inter-ministerial commission will be held before the visit of Russian president, which will work out a mechanism for financing mega projects,” a government official said.

In a meeting of the Inter-governmental Commission (IGC) held here on Monday, government officials gave a detailed briefing to the Russian team on planned energy projects. However, sources said, Russia made no firm commitment to the dam.

According to the official, it was just a preparatory meeting to discuss different projects, which could be tabled during deliberations with the Russian president.

In the IGC meeting, the Russian side was told that Bhasha Dam was a strategic project with power generation capacity of 4,500 megawatts to overcome the energy crisis. It will have water storage capacity of 8.5 million acre feet to feed the agricultural sector.

Chinese offer

The Chinese government has already offered Pakistan skilled labour for the construction of Bhasha Dam. China has 17,000 skilled workers, who have worked on the giant Three Gorges Dam, which is producing 30,000 megawatts of electricity.

On the other hand, multilateral donors have asked Pakistan to seek a no-objection certificate from India to pave the way for financing the dam, which they say is situated in a disputed territory. Instead, they have offered to finance another project – Dasu hydropower, but the government has rejected the plan and wants to complete Bhasha Dam first.

On Monday, a delegation of the World Bank, headed by Country Director Rachid Benmessaud, called on Federal Water and Power Minister Ahmed Mukhtar and once again offered to finance phase-I of the Dasu project.

Dasu hydropower project is situated 7 km upstream of Dasu village on Indus River and 350 km from Islamabad. The project is located in Kohistan district of Khyber-Pakhtunkhwa.

Here's Daily Times on ongoing hydroelectric dams and irrigation canals construction in Pakistan:

The prime minister said that the timely completion of hydropower projects was vital for controlling floods along with mitigating water and power shortfall. The government is prioritising the water storage projects, he added.

Raja directed the WAPDA chairman to expedite the work on Kachhi canal, Rainee canal, RBOD-1 and RBOD-III. These projects would be instrumental in controlling the floods as well as for irrigation purposes, he added.

The chairman apprised the prime minister about the progress on eight ongoing projects with cumulative capacity of about 1,500 megawatts (MW).

Out of these, six projects of about 400 MW including Jinnah Dam 96 MW, Gomal Zam Dam 17MW, Satpara Dam 17 MW, Allai Khwar 121 MW, Duber Khwar 130 MW and Jabban Dam 22 MW would be completed in 2012 while the work on Neelum-Jhelum with production capacity of 969 MW and Golen Gol with capacity of 106 MW was progressing at full swing, said the chairman.

The prime minister directed the chairman to take up work on small and medium-sized dams especially in Balochistan and FATA on priority. The prime minister also directed WAPDA chairman to work on war footing to repair the breaches in the canal networks affected by recent floods in Sindh and Balochistan, so that the infrastructure could be restored.

Here's a Business Recorder report on Tarbela dam's 4th tunnel power generation project:

The government would award the contract of 'Tarbela Fourth Extension Hydropower Project', costing $928.9 million, including $840 million World Bank loan in March next year to initiate Civil and Engineering and Management (E&M) work. According to documents obtained by Business Recorder, mobilisation of contract was expected by the end April 2013. Pre-qualification of applicants for Civil and E&M works is under way.

The project would be completed by June 2018. The government would spend $88.9 million for this project. Tarbela has an installed power generation capacity of 3,478 megawatts on tunnels 1, 2 and 3 while tunnel 4 was originally intended for irrigation water releases only, but subsequent studies proposed its conversion to irrigation-cum-generation tunnel.

The latest proposed installed capacity of Tarbela is 1,410MW. Ultimately, Tarbela's capacity would be upgraded to 4,888MW after the development of tunnel 4. The projected energy form the project is 3840 GWh/year while annual capacity factor is 31 %.

According to the Project's cost estimate, powerhouse and tunnel work is to cost $307.45 million, turbines, generators and auxiliaries; $434.24 million and implementation of SAP and EMP dam monitoring $28.63 million. Similarly, project management, technical assistance and training cost is $20.45 million while base cost with physical/price construction is $817.9 million.

The Executive Committee of National Economic Council (ECNEC) has approved the Project on August 16 this year for Rs 83.6 billion, including foreign exchange component of Rs 65.8 billion. A million families would benefit from the additional power. Load shedding would be substantially reduced. Documents also showed that about Rs 39 billion per annum revenue was expected after the completion of the Project. During construction period, between 2,000 and 2,500 jobs would be created.

SEOUL, Dec. 4 (Yonhap) -- South Korean President Lee Myung-bak and Pakistan's President Asif Ali Zardari agreed Tuesday to bolster all-round economic cooperation between the two countries, especially in the areas of railways and hydropower, the presidential office said.

Zardari arrived in Seoul on Monday for a three-day official visit, and held summit talks with Lee with a focus on strengthening cooperation in trade and investment, infrastructure construction, energy and development assistance, the office said.

The two sides signed two memorandums of understanding, one calling for Pakistan to provide supportive measures for South Korean aid projects to the country and the other calling for cooperation in railway modernization and related projects in Pakistan.

Lee and Zardari noted that trade between the two countries climbed to US$1.56 billion last year following a fall in the wake of the 2008 global economic crisis, and that South Korean firms are getting actively involved in infrastructure, chemical and other projects in Pakistan, the office said.

Zardari expressed gratitude for South Korea's official development aid to the country, and South Korea agreed to help Pakistan draw up a national development plan, known as the "Country Partnership Strategy," by the first half of next year, the office said.

Zardari also offered congratulations to South Korea on its election as a non-permanent member of the U.N. Security Council and the two countries agreed to strengthen cooperation at the global body. Pakistan also holds membership on the council.

LAHORE, Dec. 26 -- To harness water resources for electricity generation, two memoranda of understanding (MOU) have been signed by the government of Khyber Pakhtunkhwa, the Pakistan Water and Power Development Authority (Wapda) and Korean firms. The agreement involves developing two hydropower projects in a public private partnership with a cumulative power generation capacity of 1,161 MW. According to an announcement made here on Monday, this agreement emerged from President Zardari's recent visit to Korea.

The first MoU was signed with Korea Midland Power Company (KOMIPO) for the 496 MW-Lower Spat Gah Hydropower Project and the second with K-Water/Daewoo consortium for the 665 MW-Lower Palas Valley Hydropower Project. The MoU was signed by Wapda Chairman Raghib Shah, KPK Shydo Managing Director Bahadur Shah, KOMIPO Chairman and CEO Choi Rak and K-Water representative in Pakistan, No Hyuk Park.

Korean Ambassador to Pakistan, Choong Joo Choi, was also present. Addressing the ceremony, he termed the signing of the MoU a milestone that would bring the two countries closer.

Shah said that the Korean firms, which were selected through international competitive biddings, will bring in with them an investment of more than two billion dollars for the construction of the two hydropower projects. This shows the confidence that international financial institutions have in Wapda for the implementation of projects in the water and hydropower sectors, he added.

Shah further said that the two projects will contribute more than 4.5 billion units of electricity to the National Grid annually. He said that they are part of the strategy for optimum utilisation of the water resources to help overcome electricity shortages and stabilise power tariff for the consumers. He said that Wapda is implementing more than 20 projects to generate roughly 20,000 MW of electricity and store 12 million acre feet of water.

Lower Spat Gah Hydropower Project is located on a left bank tributary of River Indus with its confluence some eight kilometers downstream of Dasu town in district Kohistan. Moreover, Lower Palas Valley Hydropower Project is located on another left bank tributary of River Indus with its confluence some 12 kilometers upstream of Patan town in Kohistan district

The current wave of load-shedding will end soon, as water flow in canals will come to normal levels in coming days and production of electricity will increase. The government is making all-out efforts to cope with the current situation and eliminate load-shedding.

The energy mix of the country consists of around 34% electricity generation from hydel resources and 66% from oil and gas. Reports show that hydropower production has dropped from 6,500 megawatts to 1,500MW these days.

Every year, canals are closed in winter for de-silting and the Indus River System Authority (Irsa) curtails water releases from major reservoirs of Mangla and Tarbela during December and January, leading to a sharp decline in hydropower production.

On the other hand, gas companies also cut supply in winter to those power producers, which have nine-month gas supply agreements, disrupting electricity production. Thus, the shortfall increases and the Ministry of Water and Power is left with no choice but to opt for power outages.

However, considering the scale of gas and water curtailment, the power supply has been managed very well. The ministry is mindful of providing maximum relief to people by resorting to load-shedding mostly during night and very less power cuts in day time so that routine life of people is not disturbed.

The canals are expected to be opened in the second week of January and production of hydropower will increase and outages will come down.

The ministry is also making alternative plans to cope with the power crisis as it is working to increase the generation capacity of existing power plants.

It is very important that the people should also come forward and help the government in conserving electricity, which could be done by saving power through all possible ways. This way, they will not only be helping the government, but will also reduce their electricity bills....

ISLAMABAD: The Water and Power Development Authority (Wapda) iss working on a number of large and medium-sized dams in the federally administered tribal areas (Fata) including the Gomal Zam Dam in South Waziristan and the project was likely to be completed by end of January.

Official sources told APP here on Thursday that the hydropower component of the dam had already been completed, while progress on the irrigation and flood protection component of the project was almost near completion.

Gomal Zam Dam is being constructed in the Khjori Kach area of South Waziristan, over the Gomal River which iss also one of the significant tributaries of Indus River. The dam will irrigate 163,086 acres of barren land of Tank and districts of Dera Ismail Khan.

The dam will have a gross live storage of water of 1.14 million acre feet (MAF), whereas 0.36 MAF of perennial and flood flow of the Gomal River will provide irrigation water to barren lands.

A small power plant was installed at the foot of the dam. Designed by an Italian company, the plant will produce 17.4 megawatts of power.

The multipurpose project will boost development in the remote area by enhancing irrigation, controlling flash floods and producing economical electricity. The dam was initially conceived in the late 1800s for meeting the water needs of Dera Ismail Khan.

LAHORE: Work on Kurram Tangi Dam, a multi-purpose project in North Waziristan Agency, is set to kick off in the next two months, with the Water and Power Development Authority (Wapda) needing swift handover of land and effective security arrangements.

Construction work on the first component will be initiated in March this year. In this phase, a weir, two canals covering an area of more than 16,000 acres, two power houses of about 19 megawatts and a 132-kilovolt transmission line will be constructed. Annual benefits of the first component have been estimated at about Rs1.7 billion.

Shah asked the governor to help in early handover of land to Wapda and ensure effective security arrangements.

He said the United States Agency for International Development (USAID) had expressed interest in providing funds for the first component. An environment assessment study is also underway to pave the way for the financing....

US Ambassador Richard Olson reiterated on Tuesday the commitment of the United States to extend full help and cooperation in resolving the energy crisis faced by Pakistan.

Addressing a function here at Tarbela Dam project, along with Water and Power Development Authority (Wapda) Chairman Syed Raghib Abbas Shah to recognise the completion of the US funded Tarbela Dam restoration project the US ambassador said, “The United States understands that Pakistan is facing an energy crisis and we are committed to doing our part.”

The restoration of three generators at Tarbela added 128 megawatts of power to the national grid.

He said, “The work completed here at Tarbela contributes enough electricity to supply two million customers, and helps provide relief to those suffering from extensive power shortages.”

Wapda Chairman Syed Raghib Abbas Shah appreciated the support of the United States to the energy sector in Pakistan.

The US Agency for International Development (USAID) provided $16.5 million to the Pakistan Wapda to repair three power generation units and to train Tarbela’s staff to operate the upgraded equipment to increase production of electricity at Tarbela.

Relieving Pakistan’s energy crisis is a top priority for US assistance to Pakistan, said Olson.

In addition to Tarbela, the United States is also funding other high impact projects, such as the rehabilitation of the Mangla dam, and renovation of thermal plants at Jamshoro, Guddu, and Muzaffagarh, which have already added over 650 megawatts since October 2009.

The US government is also co-financing the completion of the Gomal Zam and Satpara dams which will add another 35 megawatts and irrigate more than 200,000 acres.

Finally, the US is helping to replace thousands of highly inefficient agricultural and municipal water pumps throughout the country to save additional megawatts.

These projects are expected to add 900 megawatts to the national power grid by the end of 2013, enough energy to power two million households and businesses.

ISLAMABAD, March 20 -- Government would complete the Neelum Jhleum Hydro project, Golen Gol and Dubair Khawar hydro projects within the stipulated time frame and resolve the issues related to any project.

This assurance was given by the Secretary Water and Power, Sikander Ahmed Rai while chairing a meeting with visiting Joint Supervisory Mission (JSM) of lead financers of three hydro power projects here today.

The consortium includes representatives from Islamic Development Bank, Saudi Fund Development, Kuwait Fund Development and Opec. The meeting was also attended by additional Secretary Ministry of Water and Power, Chairman Wapda and senior officials of Neelum Jheluim project, Golen Gol and Dubair Khawar project and ministry of Water and Power.

Secretary water and Power said that the government has also allocated the funds for the projects and financial support of the donors would help to complete the project in time. He said that the progress on three projects being reviewed and monitored regularly. Pakistan is facing energy shortage and timely completion of these projects would help to bridge the gap between demand and supply. He also thanked the delegation for visiting Pakistan to review the progress of the projects.

Earlier, the Chairman Wapda briefed the JSM that KhanKhawar hydro project of 72 MW and Allai Khawar Projects of 122 MW have been completed. While the remaining three projectsw of 1205 MW would be completed as per their schedule. Dubair Khawar project would be completed by June this year. Neelum Jhelum Hydro project of 969 MW by 2016 and Golen Gol project of 106 MW would be completed by 2015. He also informed that the Government has recently approved Rs 24 billionfor for Neelum Jhelum Project. He said that 47 % work on tunnel boring has been completed on Neelum Jhelum project.

The JSM appreciated the progress on three projects and stated that the consortium of financers would continue its support for energy projects. The JSM would also visit the sites of all the three projects to review the progress

Here's Express Tribune on private sector jumping in to add power generation capacity:

After five years of unbearably long daily power outages, Pakistan’s private sector has had enough: over the next five years, they plan on investing over $14.3 billion in increasing the nation’s power production capacity by nearly 46%, and they are doing so by investing in the cheapest possible sources of electricity.

According to data released by the National Electric Power Regulatory Authority (Nepra) in its 2012 State of the Industry report, private sector firms have already begun work on dozens of projects that would substantially increase the country’s electricity generation capacity. For the purposes of this special report, we include only those projects that are scheduled to be completed by the end of the next administration’s term in 2018.

If the next administration were to do absolutely nothing to prevent or slow down the progress currently being made on projects that are already approved and progressing, Pakistan’s power generation capacity will increase to 34,200 megawatts (MW), compared to the approximately 23,500MW today. Of that increase, more than 80% is coming through private sector initiatives.

Yet it is not just the private sector’s initiative that deserves to be applauded: it is also their foresight. Nearly all of the private sector projects scheduled to come online use the cheapest fuels possible. These firms are scheduled to add about 4,900MW to the nation’s hydroelectric power generating capacity, for example. Another 800MW will be added in terms of gas-fired thermal power plants. And nearly 3,000MW will be added or converted to coal and bagasse (a waste product from sugar manufacturing).

Residents of Karachi should rejoice in particular: the Karachi Electric Supply Company is converting 840MW of oil-fired thermal power stations to coal, which will dramatically increase the country’s only private utility’s ability to generate cheaper electricity. Put simply, this will mean even fewer power outages in Karachi.

The private sector’s focus appears not only towards fuel sources that are cheap, but also easily available. Natural gas, for instance, is possibly the cheapest source electricity, cost an average of Rs4.24 per kilowatt-hour, according to Nepra. But the bulk of the investment is going towards hydroelectricity, which, according to Nepra’s tariff determination, is expected to cost Rs5.43 per unit for the first 12 years of a project’s life, while the debt used to finance the plants is still being paid off, following which the tariff will be reduced to Rs2.47 per unit.

The preference for hydroelectricity has to do with the fact that Pakistan’s natural gas reserves are rapidly being depleted and importing gas is far more difficult than importing coal. Power plants that run on imported coal can produce electricity for an average of Rs10 per unit, according to industry experts, much cheaper than the Rs16 per unit that oil-fired thermal plants cost.

Compared to the $14.3 billion being invested by the private sector, the government is planning to invest just over $2.5 billion over the next five years to upgrade its power infrastructure, which will add about 2,100MW of electricity generating capacity over the next five years, the overwhelming bulk of which will be in thermal power plants that can run on both oil and gas.

The picture, of course, is not completely rosy. Power projects are notorious for not meeting their deadlines so it is possible that the next administration will not see all of these projects come to fruition during its term. But given the private sector’s commitment to solving Pakistan’s energy problems, the least the government can do is not create hurdles in their way. It will only help their own re-election chances.

Here's a Nation newspaper report on German financing of hydel projects in Pakistan:

A delegation of the KfW Development Bank, Germany, headed by Dr Claudia Loy called on Wapda Chairman here on Monday and discussed with him the matters relating to financing of various hydropower projects.The KfW Development Bank is providing 97 million Euros for the construction of 122 MW-Keyal Khwar and has also committed to co-finance the 35 MW-Harpo Hydropower Project along with its French counterpart AFD by providing 20 million Euros. In addition, the KfW Development Bank has also shown interest in financing the 80 MW-Phandar Hydropower Project.During the meeting with the KfW Development Bank’s delegation, Wapda Chairman thanked them for their support in financing a number of Wapda projects.He expressed the hope that the cooperation between the KfW Development Bank and WAPDA would be further enhanced in the days to come. He apprised the delegation that main works of Keyal Khwar Hydropower Project will soon be initiated, as all the pre-requisites are almost finalised in this regard.Wapda Chairman expressed the hope that KfW Development Bank will come forward for better investment opportunities in other hydropower projects and well being of the people of Pakistan. The KfW Development Bank Division Chief, appreciating the technical expertise of WAPDA, said that WAPDA is one of the best organizations in Asia. She said that the KfW Development Bank and WAPDA have a long history of mutual cooperation, adding that the Bank would continue supporting WAPDA for construction of water and hydropower projects. We feel Pakistan’s energy sector needs more financing from Germany, she added.

Here's an Express Tribune report on Islamic Development Bank (IDB) funding for energy projects in Pakistan:

The Islamic Development Bank (IDB) ) on Monday announced its commitment for $850 million support for development projects in Pakistan.According to a release, the support was announced as a five member IDB delegation headed by the institution’s vice president Birama Boubacar Sidibe called on Finance Minister Ishaq Dar in Islamabad on Monday.Sidibe said that the IDB was prepared to disburse $850 million dollars in addition to the 750 million Euros in support and the $150 million in trade assistance it had approved and started paying in August. The fresh project assistance to Pakistan will be provided over the next three years.The IDB VP informed Dar that he expects project Pakistan plans to undertake in future would make IDB one of its largest operations. “Your priority is our priority” said Sidibe.In addition to the financial assistance, Sidibe said that the IDB was also ready to constitute consortiums for financing projects in Pakistan.The finance minister said that Pakistan looks forward to stronger and better economic relations with IDB in the future.Sidibe added that Pakistan is an important member country of the IDB. He added that Pakistan’s support of the agency had played some part in helping it secure a AAA ranking from international rating agencies.Dar briefed the delegation on status of ongoing power projects in Pakistan including the 969 MW Nelum Jhehum Hydropower Project which the IDB is financing. The finance minister hoped that the project, whose cost had tripled due to neglect of the previous government, would be completed by 2016.Similarly, work on the 425/525 MW Nanidpur Project, which had been delayed for over three years, had been started in full swing.Additionally, Dar said that the government is working to add 10,000 MW of generation into the national grid and is presently working on the 2117 MW Karachi coastal project and 6600MW coal fired thermal Project in Gadani. He added that the government was also working on the parallel projects of Diamer Basha Dam and the Dasu Project.

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Here's a VOA report on the growing use of microhydro turbines for generating electricity at village level:

Many areas of Pakistan suffer energy shortages because the country's grid does not reach all of its remote corners. In one section of Pakistan's Kashmir region, people have taken the initiative to create their own energy from abundant streams and rivers, using small-scale turbines.

The Neelum Valley, in the Himalayan region of southeastern Pakistan, is sometimes called “Heaven on Earth” for its unspoiled beauty. Local residents want to preserve their forests and their clean environment despite a growing need for electricity said Shafiq Usmani, an official at a local hydroelectric board.

"All the beauty of the Neelum Valley is dependent upon those forests, streams, and neat and clean water, and this can only be sustained if we are giving them the clean energy," said Usmani.

Less than half of the Neelum Valley's 200,000 inhabitants have access to electricity from the national grid. However, the Neelum River itself and its tributaries flow with enough force to produce energy. Some local communities use small turbines, called hydel machines, to generate electricity to light their homes.

"This hydel machine [turbine] was installed with a share from 50 families, which costs us nearly $3,000. We started this small hydro scheme as we needed it. We only get light from it and no other electric appliances. We start this turbine at 3 in the afternoon and switch it off the next day at 8 am," said Rahimullah, one of the turbine operators.

Villagers say the homemade turbines have transformed their daily lives.

“When we had no electricity there was always smoke, as we use wood for heating and cooking, which causes diseases. Since we installed this project, thank God, we have gotten rid of these diseases and gained some other benefits," said Mushtaq Ahmad, a villager.

Even so, there is not enough energy for everyone's needs, and that means that trees still have to be cut down to provide wood for fire. Engineer Sardar Basharat Ahmad said the valley needs more turbines.

"Cutting down trees is a big loss, using wood for heating and cooking causes health problems. If the hydel is promoted and new projects are set up, it will fulfill all the requirements of the people like cooking and heating, and it will save the cutting down of green trees," said Ahmad.

Pakistan is plagued by power cuts, especially in the summer. The blackouts affect ordinary people's lives and hamper the economy. The country is using only about 10 percent of its identified hydropower potential.

BAHRAIN, Pakistan, March 14 (UPI Next) -- Installation of a micro-hydropower station on a stream in Serai has brought electricity to the people of the remote village in the highlands of the Upper Swat Valley in northwestern Pakistan for the first time.

Residents of Serai, in Khyber Pakhtunkhwa province's Malakand Division, about 60 miles north of the Swat district capital of Mingora, say the introduction of electricity has provided them with benefits most people take for granted, such as allowing them to walk at night without fear of tumbling off steep paths to their death.

Similar power plants are in the works for the area, a move that could pave the way to solving Pakistan's increasing energy shortage.

Micro-hydropower stations require less water than do conventional hydropower stations, so a single family can install one producing 5 to 10 kilowatts for personal use.

The power station was built by the European Union and the Sarhad Rural Support Program, a development organization working in Khyber Pakhtunkhwa province and the Federally Administered Tribal Areas.

"A total of 240 micro-hydropower plants are to be installed with a production capacity of 21.7 megawatts in the parts of Malakand Division that have no access to electricity from the country's national grid," Zahid Khan, a Sarhad program project manager overseeing the installation of the plants, told UPI Next.

Most micro-hydropower plants in Pakistan can produce 5 to 100 kilowatts. The next size up, mini-hydropower plants, produce between 100 kilowatts and 1 megawatt. Small hydropower plants produce between 1 megawatt and 10 megawatts, while large plants can produce much more.

Energy experts in Malakand Division are urging government and non-government organizations to use micro-hydropower projects to tackle the country's increasing energy crisis.

Serai's 80-kilowatt power plant is among the first to be successfully installed, providing electricity to more than 700 households.

"It is something of a miracle. This is the first development project installed here. We are the most neglected and ignored people in Swat," Serai elder Abdul Qadoos told UPI Next.

"People say electricity is the source of every social development."

Another elder, Zareen Gujar, also praised the introduction of electricity.

"Our women, who used to perform household chores by torchlight, will now be able to work longer under brighter light from electric bulbs," he told UPI Next.

"Our women are now learning to use electric irons to iron our clothes too.

"We in Serai have never seen any development activity since this country came into being, as we had no roads, no middle school or high school, not even a dispensary. We have been living a life of deprivation."

Serai is in rough terrain and climbing up to houses can be difficult.

"At last, we are not blind during the darkest nights. Many of our people have died after falling at night," Gul Zada, a local community leader, told UPI Next.

"We have streetlights installed now to walk freely in at night."

Zada said no official or non-government organization had shown villagers the power potential from the water around the village.

The power plant was completed in nine months at a cost of $105,000, of which about $9,000 was raised locally....

Financing from the French Development Agency will allow for the construction of a pair of hydroelectric projects that will add a combined 785 MW of power to Pakistan's grid.The US$141.9 million credit facility agreement will help develop the 740-MW Munda and 35-MW Harpo hydropower plants, located in the Khyber Pakhtunkhwa and Gilgit Baltistan regions, respectively.Pakistan's Ministry of Water and Power assigned the Munda Dam project to Pakistan's Water and Power Development Authority in 2010 for detailed engineering design and construction. It was decided in 2007 that Munda would be a multi-purpose project, to supply water for irrigation, to mitigate flooding, and to generate power.The European Union also sought pre-qualification in April 2012 to perform a climate change adaptation study and an impact assessment study of the project, which will be built on Pakistan's Swat River.Meanwhile, HydroWorld.com reported in January that the German Ministry for Economic Cooperation and Development had agreed to provide Pakistan a $27.3 million loan for the Harpo project via the KfW Development Bank.Pakistan's Water and Power Development Authority (WAPDA) began sought expressions of interest for engineering design and tender preparation for the plant in May 2009.Harpo will be located on the Harpo Lungma River, which is a tributary of the Indus River.

WASHINGTON- June 10, 2014- The World Bank’s Board of Executive Directors approved on Tuesday a financing package from the International Development Association (IDA), the World Bank Group’s grant and low-interest arm, to help expand hydro-electricity generation in Pakistan through the development of the Dasu Hydropower Stage-I Project (DHP-I). The package consists of an IDA Credit of $588.4 million and an IDA Partial Credit Guarantee (PCG) of $460 million to help mobilize commercial financing for the project.

DHP-I would have 2,160 megawatt (MW) hydropower plant on the main Indus River, which can be expanded to 4,320 MW in future with low additional cost. The project, in addition to facilitating growth and development in Pakistan, will also help build the Water and Power Development Authority’s (WAPDA) capacity to harness the vast hydropower resources of the country in a sustainable manner.

“Dasu Hydropower Project is important for helping the people of Pakistan to reduce their carbon footprint and make electric power generation more sustainable,", said Rachid Benmessaoud, World Bank Country Director for Pakistan. “The program is an important part of the transformational energy initiative of Pakistan, in which the support from across the World Bank Group is focused on helping Pakistan's energy sector out of its crisis and onto a more sustainable path that supports economic growth.”

DHP-I is a run-of-river project located on the Indus River about 240 km upstream from the Tarbela dam, close to Dasu town, in Kohistan district. It is an important element of the government’s strategy to restore Pakistan’s energy sector to a role that will effectively support long-term economic growth. It is a strategic investment that: (i) improves energy security and affordability through a structural shift to a low cost, low carbon fuel mix and reduced cost of electricity generation; (ii) reduces the sector deficit and saves foreign exchange of the Government of Pakistan by displacing high cost imported fuel; and (iii) builds the institutional capacity of WAPDA to harness the hydropower potential of the country in a sustainable manner, in particular the development of the Indus Cascade; and (iv) provides a financing and investment model that can be followed for other large hydropower projects in Pakistan.

The direct beneficiaries of DHP would be the millions of energy users, including industry, households and farmers who would get more electricity at lower cost and suffer fewer blackouts. The project would provide more electricity during the summer months when capacity shortages are most severe. Non-users would benefit indirectly because of higher productivity and employment, particularly in the industrial sector.

“Dasu Hydropower Project will kick start the development of the Indus Cascade that is crucial for reducing the overall cost of electricity generation based on domestic resources,” said Masood Ahmad, Task Team Leader and Lead Water Resource Specialist. “The Project would provide benefits to most sectors of the economy in Pakistan, and the population as a whole would benefit directly or indirectly.”

The DHP-I cost is estimated at about $4.2 billion and the financing plan consists of IDA credits, IDA Partial Credit Guarantees and contributions from WAPDA and the NTDC. This is the first attempt by the World Bank Group to finance a large infrastructure project on a sequential basis through a combination of credits and guarantees to mobilize the full financing over the construction period. The credit is financed from the International Development Association (IDA), the World Bank Group’s grant and low-interest arm. It will be on standard IDA terms, with a maturity of 25 years, including a grace period of 5 years.

The United States on Wednesday pledged support for Pakistan’s massive $14 billion 4,500MW Diamer-Bhasha dam project as top officials and business leaders explored investment prospects, amid exponential energy needs of America’s ‘critical partner’ nation.Both the US officials – including US Agency for International Development (USAID) Administrator Dr Rajiv Shah and US Special Representative Dan Feldman – and Pakistan’s Finance Minister Senator Ishaq Dar and Minister for Water & Power Khawaja Muhammad Asif, who is also defence minister, highlighted tremendous opportunities for American and international investors in the ‘transformational’ power generation and water storage project.The officials spoke at a joint platform that brought together senior leaders and experts and business leaders at the US Chamber of Commerce at a meeting, co-hosted by the USAID and the US-Pakistan Business Council. Pakistan’s Ambassador to the United States Jalil Abbas Jilani and US Ambassador in Islamabad Richard Olson participated in the daylong conference, spread over several sessions.

Pakistan needs 10,000MW of power to meet its rapidly growing domestic, industrial and agrarian requirements. The materialisation of Diamer-Bhasha dam will be a giant step in that quest.Besides producing 4,500MW of power, the dam will help with four million acre of water for irrigation, save millions from flash flooding, boost other hydro projects and contribute vitally to extending life of Tarbela Dam by 30 years.The Obama administration officials assured the investors of effective results, citing results from US-financed energy up-gradating projects in Pakistan.“We know that success can take hold,” Dr Shah said in reference to completion of small projects and addition to power generation capacity of large dams.Daniel Feldman said the US and Pakistan have a wide-ranging strategic partnership and that Washington is in for a long-term economic and investment relationship with Pakistan, particularly in the energy field. “Investment in Diamer-Bhasha dam is the smartest choice for Pakistan,” Feldman remarked, reiterating the White House and Secretary John Kerry’s commitment to back economic and energy security of Pakistan.Finance Minister Ishaq Dar said Prime Minister Nawaz Sharif’s government is committed to encouraging foreign investment in various sectors of the economy and is crystal clear that the country needs both the Dasu and Bhasha dams. “We have demonstrated our commitment – and acquired land from own indigenous resources,” he added.He apprised the meeting of government’s robust economic agenda, saying Islamabad has stemmed the economic downslide it inherited and now exports, GDP rate, remittances, revenue collection and industrial growth, have all registered marked growth.“Despite demonstrations in Islamabad, the rupee has been fairly staying at stable exchange rate, while inflation has also been checked,” he added. Senator Dar said the government has paid off circular debt it had inherited from the previous administration.Khawaja Asif said Washington’s support for the vital Diamer-Bhasha dam would cement the relationship between the two countries.

The U.S. Agency for International Development (USAID) seeks bids to perform a technical engineering review and upgrade of plans for Pakistan's proposed 4,500-MW Diamer Bhasha hydroelectric project on the Indus River. Bids are due November 17.USAID also has called for bids by October 27 to provide financial advisory services to the government of Pakistan for Diamer Bhasha. It awarded a contract in September to MWH Global to perform an environmental and social impact assessment of the project.USAID has pledged US$200 million toward development of Diamer Basha, with funds to be used for assessment of environmental and social effects of the proposed project as well as preparation of a financial package. The project is to include a 272-meter-tall roller-compacted-concrete dam, two diversion tunnels, two underground powerhouses of 2,250 MW each, a permanent access bridge, and hydro-mechanical and steel structural equipment.USAID/Pakistan now seeks bids for technical assessment, review and upgrade of the engineering design, cost estimates and documentation for Diamer Bhasha. The work is expected to require one year at a cost of US$5.59 million to US$6.59 million.A solicitation notice may be obtained from the U.S. Federal Business Opportunities Internet site, www.fbo.gov, by entering Solicitation No. AID39114000059 in the "Keyword/Solicitation #" box.Bidders are to submit separate technical and cost proposals by 4 p.m., U.S. Eastern time, November 17. For information, contact Maria Hassan, Acquisition and Assistance Specialist, Department of State, USAID Unit 62206, APO 09812-2206, Islamabad, Pakistan; (92) 51-2081285; E-mail: mahassan@usaid.gov.

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I am the Founder and President of PakAlumni Worldwide, a global social network for Pakistanis, South Asians and their friends. I also served as Chairman of the NEDians Convention 2007. In addition to being a South Asia watcher, an investor, business consultant and avid follower of the world financial markets, I have more than 25 years experience in the hi-tech industry. I have been on the faculties of Rutgers University and NED Engineering University and cofounded two high-tech startups, Cautella, Inc. and DynArray Corp and managed multi-million dollar P&Ls. I am a pioneer of the PC and mobile businesses and I have held senior management positions in hardware and software development of Intel’s microprocessor product line from 8086 to Pentium processors. My experience includes senior roles in marketing, engineering and business management. I was recognized as “Person of the Year” by PC Magazine for my contribution to 80386 program. I have an MS degree in Electrical engineering from the New Jersey Institute of Technology.
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